Hearing of the Senate Committee on Energy and Natural Resources on Nominations of Jeffrey Clay Sell to be Deputy Secretary of the Dept of Energy.....
Hearing of the Senate Committee on Energy and Natural Resources on Nominations of Jeffrey Clay Sell to be Deputy Secretary of the Dept of Energy and Patricia Lynn Scarlett to be Deputy Secretary of the Interior
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Senator Murkowski. Mr. Chairman, I just have a couple quick questions, and I apologize that I wasn't here earlier. I was at
Environment and Public Works. We're trying to get Clear Skies, and unfortunately we were not successful in that effort.
But thank you, and I hear very clearly that you won't be joining me on my next trip to ANWR. We don't have spring and
fall, so I can't offer you those seasons. But I do appreciate you leading the delegation up north this weekend. It was very
important.
A couple questions to both of you. First, thank you for being here this morning and congratulations to you as you move
up and on.
First, Ms. Scarlett, if I can ask you just a couple questions about the U.S. minerals industry. The National Mining
Association frequently observes that many areas in the U.S. are regarded as the least attractive for new mineral investment due to permitting and other public policy considerations. Countries like Chile are often cited as most favorable for mineral
development.
What can the Interior Department do to improve the investment climate for mineral exploration here in the United
States?
Ms. Scarlett. Thank you, Senator Murkowski. We have worked hard these past 4 years at the Department of the Interior,
whether it's with respect to energy development or minerals access, to ensure access to public lands where those resources
are, doing so while balancing the environmental and other considerations.
To that effect, we have tried to improve our permitting processes where that is relevant. For example, particularly in
energy development, we project to reduce our backlog of applications for permits to drill to virtually nothing by 2006.
In the minerals realm as well, we have undertaken certain decisions that try to provide greater security to those who are
investing in minerals resource development on public lands.
If you have particular issues that appear to be barriers, we would be happy to discuss those with you and determine how
we might address them.
Senator Murkowski. I'd look forward to that conversation because I know that some in Alaska feel that there are
significant barriers. So we'd like to talk with you about that. The U.S. Geological Survey has a robust program to help
identify promising areas for mineral exploration, including some areas in Alaska under the NRAP and some other programs. Do
you believe that USGS has a legitimate role in encouraging mineral exploration in the United States and, if so, what about
the funding component?
Ms. Scarlett. The U.S. Geological Survey has played a very significant role in this Nation's history, in exploring its
geology and including the minerals assessments. We have coverage of minerals assessments data bases in the U.S.
Geological Survey of virtually the entire United States. Our 2006 budget does propose to concentrate that effort on further
assessments on Federal lands. We are making some very difficult balancing choices as we develop our budget and try to maintain fiscal discipline.
In that context, we have determined to focus the USGS effort on the Federal lands, also understanding that the private sector, industry and others, do undertake some mineral assessments on the non-Federal private lands. So we feel that
this is a good and effective utilization of the resources that we have at Interior.
Senator Murkowski. So you're suggesting then that there needs to be more of a private investment focus, rather than our
involvement on the Federal lands?
Ms. Scarlett. No, let me clarify. We are continuing on the Federal lands the minerals assessment program for the U.S.
Geological Survey, believing that that focus on Federal lands is appropriate and is indeed a high priority. Our 2006 proposal
calls for focusing that assessment on Federal lands while leaving the assessment of non-Federal lands to other entities
such as the private sector.
Having said that, I want to note that we already do have and will continue to maintain the existing data bases that have
coverage of mineral assessments on both Federal and non-Federal lands.
Senator Murkowski. Okay. Very briefly on the fires that we suffered in Alaska last summer. It was the worst fire season in
Alaska's history and, as you know, the wildfires in Alaska are attacked on an inter-agency basis, and the State took the lead
in the southern part of the State and BLM's Alaska Fire Service took the lead in the northern part of the State.
There was a lot of concern last year as the fires kind of stepped up about whether Canadian air tankers that were under
contract to the State could be used to fight the fires in the BLM-protected areas. I was up there at that time and there was
a great deal of uncertainty, and the uncertainty was made even worse because you couldn't see. The smoke in Fairbanks was so dense that you got up in the air and you couldn't tell what was State land, what was Federal land. In fact, we couldn't even
fly the aircraft.
But in terms of fighting the fires, it really is that initial attack, requiring an aggressive initial attack in our wildfires, sending all the heavy smoke into the urban communities like Anchorage and Fairbanks--and we recognize that we've got to do what we can to make these conditions so that you can actually breathe in the interior there. So I would like your assurance that you're going to work with me and the State of Alaska to ensure that the State's contracted air tankers can be deployed where they will be most needed to protect the health and safety of Alaskans.
We anticipate again another tough fire year up north.
Ms. Scarlett. Yes, Senator, thank you very much. And I actually have looked into this specific issue because it is a
high priority to ensure that interoperability. As you will recall, last year we had an issue of having to ground the
Federal large air tankers because of some safety concerns. I am pleased to note that we now have gone through a safety
assessment process and have eight large air tankers that were approved toward the end of last year and several more being
approved going forward.
As we do that, we will have more of the large air tankers in the Federal force that we will be able to utilize on an
inter-agency basis. What I am told is that the State assets, until we go through this process of safety assessment, the
State assets will be utilized on the State lands, and in an emergency basis--that is, if there's a determination of threat
to life or other significant emergency--that the State assets can be deployed on an inter-agency basis on Federal locations
as well.
But we will work hard to strengthen that interoperability and to ensure that we have seamless firefighting in Alaska and
throughout the Nation.
Senator Murkowski. Well, that's going to be important to us. When you say you will have the ability if there is threat
to life, as you know, in many of these areas it's pretty wide open spaces. We don't have a lot of human life that is at risk,
but it's the health safety factor with the intensity of the smoke that's coming in that causes real respiratory issues. So
I'm not quite sure how we're defining that emergency when we can say we've got this seamless interoperability.
But I'd like to think that we can work with you on that so that it works when we're in the midst of these very terrible
fires.
Ms. Scarlett. Senator, we very much look forward to working with you on that. We are getting through some hurdles on the
large air tanker safety issues, but as we move forward through that certainly interoperability is a key goal.
Senator Murkowski. Mr. Chairman, I just have a couple questions for Mr. Sell, but if Senator Salazar still has more I
don't want to monopolize more time right now.
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Senator Murkowski [presiding]. Thank you, Senator Salazar.
Mr. Sell, welcome again. Nice to see you here in this capacity. As you know, we achieved some success in the last
Congress as it related to moving forward at the Federal level with certain incentives for an Alaska natural gas pipeline,
helping to address what we recognize in this country is an ever-increasing shortage of natural gas, and up in my State
we've got the ability to supply vast quantities. We've just got to figure out how to get it from there to here.
That process is moving forward at the State level. Now there are several applications that are pending. We don't know
yet who the project sponsor will be, but there is going to be a lot of coordination that will be required at the Federal level.
The DOE is going the play a vital role as this project moves forward regardless of who the project sponsor will be.
DOE's responsibilities will include granting the necessary authorizations, establishing an Office of Federal Coordinator,
conducting environmental reviews, and really just a lot of coordination amongst various Federal agencies. We learned at
the budget hearing last week that DOE does not have funding in its fiscal year 2005 budget to carry out its responsibilities
under the Alaska gas pipeline legislation and that DOE would need reprogramming authority to fund the responsibilities; and
also, looking at the 2006 budget, doesn't include any funding as well.
So I am looking for your assurance that you will work with us as we are moving forward to make this very important
national project a reality as we determine what funding is required, certainly for instance with the Office of Federal
Coordinator. These are things that we need to get in the pipeline, so to speak, as soon as possible. So just looking for
your assistance on this very important issue.
Mr. Sell. Senator, if I'm confirmed and make my way over to the Department of Energy, you will absolutely have my
assistance in doing that. Your leadership in the last Congress in getting the relevant authorizations passed was critical. The
lower 48 desperately needs the natural gas of Alaska and we need to build the pipeline to get it to the marketplace. It's a
very important issue for the President and for this country and for the Department, and I look forward to the opportunity of
getting over there and resolving these initial--or working with you to try to resolve these initial funding issues, and then as
the project proceeds.
Senator Murkowski. Good. Well, I appreciate that. I'm sure we will have a great deal of contact as we're moving forward to
make this very important project a reality.
We had an opportunity, I guess it was about a month and a half, 6 weeks or so ago, when this committee took up the issue
of natural gas and the supply, and we, the committee, heard testimony from a gentleman from Alaska, they have the director
of the Alaska Division of Oil and Gas, Dr. Mark Meyers, talking about the potential not only in Alaska but in the country for
an unconventional gas source, natural gas hydrates, with the recognition that in my State we've got about 590 trillion cubic
feet of onshore hydrate reserves, potentially 32,000 trillion cubic feet of potential offshore hydrate reserves--really, enough gas out there to supply the Nation for generations.
And it's not just, these hydrates are not just located in Alaska, but down in the Gulf of Mexico, and truly a huge potential for us. Dr. Meyers was actually here in Washington yesterday and gave a presentation to some of us after lunch to just kind of educate a little bit more about the potential for this.
Now, in 2000 the Congress passed the Methane Hydrate Research and Development Act and this had authorized
appropriations through fiscal year 2005 for the methane hydrate research and development. Those appropriations and
authorizations are set to expire this year. I'm working with Senator Akaka to renew this, to make sure that we will continue
the funding for what I feel is incredibly important research in the hydrate area.
We've been working with the Department of Energy. We've been working with the National Academies. We've read the
National Research Council review of the act and view this again as something that has the potential to really make a
difference. It's not something that has been focused on because we're either looking at our conventional reserves here
domestically or we're looking to foreign sources of LNG.
This is not so pie in the sky that we should not be focusing our attention and our funding in this area. Again, the
fiscal year 2006 DOE budget does not include any funding to continue the research that was done--that was begun under the
2006 act. So again I want to point this out to you as an incredible opportunity for the Department. I've had the opportunity to speak with Secretary Bodman about this and just let him know of the great potential, and I would ask for your enthusiastic support as we move forward in good research on this as well.
Mr. Sell. Senator Murkowski, I appreciate you bringing this very important issue to my attention. I was aware, although not
involved in the development of, I was aware of our proposal or the Department's proposal in the fiscal year 2006 budget, and
you will have my enthusiasm in working with you. And I would like perhaps also to have the opportunity to meet with your
expert from Alaska as I myself pursue an education on this important opportunity. So I look forward to doing that.
Senator Murkowski. We'll make sure that you have an opportunity to meet with him. He's got some great, great
information.
Ms. Scarlett.
Ms. Scarlett. Senator, might I add something on that? Our Minerals Management Service and our U.S. Geological Survey have also done some methane hydrate research work and perhaps we ought to work together with the Department of Energy to coordinate those efforts and ensure that we have a good program.
Senator Murkowski. Absolutely.
And I would feel remiss in not taking the opportunity with both of you under the spotlight today to extend an invitation
to you both to come up to Alaska's North Slope, visit ANWR, visit the operations that we have. We feel that we have really
taken the technology to its highest level and beyond as we have figured out a way to provide for exploration and production in
an Arctic climate and do it in balance with the environment.
I think that I can speak for the others that joined me on this trip this weekend that they were beyond just impressed,
but really quite amazed at how well we have been able to balance what we do up North. The greatest example was the trip
out to an exploration well from a facility, a production facility that is not connected by road. It is its own little island out on the northern plain, and it's connected to the exploration rig by an ice road that was built last month, and the rig was hauled out there on the ice road. The pad is built out of ice.
They're exploring right now. They'll be done in another 10 days or so. When they're done, they haul it out on the ice
road. In another couple months, spring is going to come. Spring will be brief. But that ice road will melt. That ice pad will
melt. There will be nothing out on that tundra except a plug that's about as tall as probably you, Mr. Sell, and about this
big around [indicating], and if there was nothing found it will be capped so you won't even be able to view it from the tundra.
But again, it's our recognition that we're dealing with a fragile ecosystem up there during the summer. So we only do our
operations in the winter, operations of the exploration. It's fascinating. I could go all day long, but we've got votes
beginning right now.
I want to thank you for your time here this morning. I thank you for your willingness to serve the President, the administration, and the country. So thank you for joining us.
And with that, we're adjourned.
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